ORBITAL_PROJECTS_1_LIMITE - Accounts
ORBITAL_PROJECTS_1_LIMITE - Accounts
Orbital Projects 1 Limited is a private company limited by shares incorporated in Scotland. The registered office is Innovation Centre, Orkney Hatston Pier Road, Kirkwall, United Kingdom, KW15 1ZL.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
In adopting the going concern basis for preparing these financial statements, the Board has considered the Company and wider Orbital group’s business activities, together with factors likely to affect its future development, its performance and principal risks and uncertainties.
In assessing whether the financial statements should be prepared on a going concern basis, the Directors have considered a period of twelve months from the date of approval of these financial statements. The material uncertainty, which may impact the company's ability to meet its liabilities as they fall due, is the company’s reliance upon it’s ultimate parent company, Orbital Marine Power Limited, for support.
The Directors clearly disclose here that as a technology development company, Orbital Marine Power Limited continues to rely largely on equity investment and grant awards to meet its ongoing funding requirements. At the date of signing, similar to previous years, further sources of funding will be pursued within the next twelve months to support the ongoing commercialisation and growth strategy of the business.
Orbital is eligible to drawdown already secured funds through the Horizon 2020: Forward 2030 Green Deal award to support the design and build of its next generation tidal turbine and further funds from the final stages of the EU supported cost reduction TiGER project through the European Regional Development Fund via the Interreg France (Channel) England Programme. Significant additional funding has also recently been secured through the Maxblade project, a program funded by the European Union and UK Research and Innovation which specifically aims to deliver a range of innovations to improve the performance of tidal turbines and reduce costs. This will also support the design and build of Orbital’s next generation tidal turbine.
The Directors have assessed the year end cash position of Orbital Marine Power Limited, the grant awards secured and targeted plus progress being made for ongoing growth equity and project finance fundraising.
The Directors are encouraged by the commercial progress being made by the company and are confident that the existing and forecast cash runway is sufficient to meet liabilities and forecast costs for a period of time that allows additional and ongoing investment to be secured for Orbital Marine Power Limited. Target investment of a minimum £5m of new equity and / or debt funding across the group is targeted in the next 12 months to supplement the already secured funding through the period and to accelerate and deliver the short term business and strategic objectives of the company.
As such, the Directors have concluded that given the commercial success in securing UK contracts for difference in UK Auction Round 4, the operational performance of the O2 turbine, the successful equity and debt fundraising completed in 2021 and 2022, plus ongoing success in securing significant grant funded program awards, it is appropriate to continue to adopt the going concern basis of accounting for the preparation of these annual accounts.
These financial statements do not include any adjustments to the balance sheet value for assets and their recoverable amounts or to provide further liabilities which may arise if the going concern basis of preparation is inappropriate.
The company was incorporated on the 7 December 2021 and therefore, the accounts comprise the results for the period from this date to 31 December 2022.
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
The company has no employees.
Directors are remunerated through the ultimate parent company, Orbital Marine Power Limited.
Amounts owed to group undertakings are unsecured, interest free and repayable on demand.
Profit and loss reserves are the cumulative net profits or losses in the statement of comprehensive income.
As the income statement has been omitted from the filing copy of the financial statements, the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006:
The auditor's report was unqualified.
We draw attention to note 1.2 of the company accounting policy which indicates that the ability of the company to continue as a going concern is subject to material uncertainty around securing additional funding during the next 12 months from the signing of the financial statements in order to fulfil its operational objectives. As stated in Note 1.2, these events or conditions, along with other matters as set forth in Note 1.2, indicate that a material uncertainty exists that may cast significant doubt on the company’s ability to continue as a going concern. Our opinion is not modified in respect of this matter.
In auditing the financial statements, we have concluded that the directors’ use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
The company has taken advantage of the exemption available in accordance with section 35 of FRS102 section 1A 'Related parties disclosures' not to disclose transactions with wholly owned group companies.
The company's immediate parent and controlling party is Orbital Project Holdings Limited. Orbital Marine Power Limited is the company's ultimate parent company. The registered office is Innovation Centre, Orkney Hatston Pier Road, Kirkwall, KW15 1ZL.
There is no ultimate controlling party of Orbital Marine Power Limited.